AI-enabled CDI powers 5% CMI improvement and 50% CDI productivity increase for Texas-based hospital

By Suhas Nair, Director of Product Management, AGS Health

Value-based care requires accurate and concise clinical documentation. Due to their measurable impacts on patient care and the revenue cycle, CDI programs and solutions serve as the foundation for value-based strategies.

According to Black Book Research, 88% of hospitals documented quality improvements and increases in case mix index (CMI) within six months of launching a CDI initiative, while more than 90% percent of hospitals with 150 beds or more reported CDI-related income and reimbursement increases of more than $2.1 million. What’s more, 85% of hospital finance executives said CDI-generated quality and CMI improvements have a major impact on their financial numbers.

As financial executives explore new ways of using data analytics to support value-based care reimbursement, CDI initiatives are a natural extension of that value. By ensuring that patient encounters are captured fully and accurately, they are the first step toward maintaining accurate health data. The absence of CDI can impact revenue, reimbursements, compliance, and patient experience, which can expose healthcare organizations to audits, fines, and clawbacks.

A Costly Oversight

Consider a 2020 report from the Office of the Inspector General (OIG) that found 82% of the claims reviewed incorrectly assigned severe malnutrition diagnosis codes not supported by documentation. As a result, OIG estimated that hospitals had overbilled Medicare by $1 billion in fiscal years 2016 and 2017. It instructed CMS to recoup overpayments and review all additional claims within the reopening period, likely leading to additional repayment demands.

In another OIG audit, 40% of providers failed to provide sufficient documentation for Medicare requirements related to neurostimulator implants. CMS was instructed to recoup $636 million in unallowable Medicare payments, and beneficiaries paid $54 million in unnecessary copays and deductibles.

A well-designed CDI program can help prevent these types of financial blows by ensuring documentation is accurate and supports specific diagnoses and codes. This, coupled with prioritization by regulators of digitally enabled clinical documentation, is the catalyst behind an uptick in the adoption of advanced CDI technologies powered by the latest artificial intelligence (AI) technologies by provider organizations like El Paso Children’s Hospital.

El Paso Children’s Upgrades its CDI

Based in El Paso, Tex., 122-bed El Paso Children’s is a Joint Commission-accredited pediatric care specialty hospital with more than 700 employees and over 500 physicians and subspecialists caring for patients in the West Texas-Southern New Mexico region. In 2020, it recorded nearly 3,000 inpatient admissions and more than 46,000 outpatient and 17,000 emergency department visits.

The hospital’s CDI program faced several challenges, including legacy systems that led to a slow, complex, and time-consuming process and dependence on manual methods for key processes like query tracking. The manual nature also drove up the costs associated with its CDI specialists and caused revenue leakage from inadequate documentation practices. Further, the inability to track performance hindered program improvement efforts.

Determined to optimize its program, the decision was made to augment current processes with AGS Health’s AI platform with computer-assisted CDI. The solution features intelligent worklists with query opportunities prioritized for concurrent review. It automatically suggests queries based on predicted coding and current documentation. Integrated encoders and groupers leverage standard coding guidelines and edits for predictive coding and accurate DRG grouping. A comprehensive clinical reference guide connected to queries helps providers understand their context, while actionable reporting features allow leaders to visualize query activity, response rates, financial impact, and qualitative outcomes across the organization.

The return on investment (ROI) was significant. El Paso Children’s realized a 5% CMI improvement through accurate DRG selection and a 50% increase in CDI productivity, including a 95% reduction in time to manage daily census. Reporting time was reduced by 90% and query time by 70%. Response rates improved by up to 95%, and the physician agreement rate increased to 95%. The enhanced system also provides a clear line of sight for documentation compliance.

Enhanced CDI Delivers Multifaceted ROI

Without an effective, technology-enabled CDI initiative, healthcare organizations are exposed to negative financial impacts from revenue leakage and clawbacks. Patient care may also be jeopardized as inefficient manual processes increasingly burden clinicians and coding professionals with re-work, leading to frustration and burnout.

However, as demonstrated by El Paso Children’s Hospital, a comprehensive CDI program powered by the right technology tools can accelerate and streamline workflows, enabling users to build out the metrics necessary to demonstrate value – ultimately helping to expand margins and increase revenues via appropriate reimbursements.

Suhas Nair is the Director of Product Management at AGS Health, leading the development of coding and CDI SaaS solutions.